A large site in the Wellington CBD that has been vacant for five years will be turned back into a petrol station.

Preliminary work is under way at 166-180 Vivian St, just metres from Cuba St.

Z Energy expects to open the 24-hour station by Christmas. The site was a Shell petrol station till 2007, when it was closed.

Z Energy spokesman Jonathan Hill said the company expected to spend up to $4 million redeveloping the site into a "tier one" station, meaning it would have its full food and coffee offering, a major plank in the company's $35m rebrand.

"There are some 20,000-plus cars that go past the site every day. It's a great central location which can also service surrounding residents through the shop."

A resource consent to operate a petrol station on the site was in place in April 2010 when Shell sold its New Zealand retail and distribution assets to Greenstone, a joint venture between Infratil and the New Zealand Superannuation Fund.

Last year, the company was renamed Z Energy.

More than 300 Shell service stations and truck stops across New Zealand have since been rebranded.

Vivian St is not the only site Z Energy has under development in Wellington. An agreement has been struck for Caltex to vacate a site at the entrance to Wellington Airport, which will be replaced by Z, which will, in turn, close a small station of its own across the road.

In recent weeks, the company has also opened sites in Sanson and Pukekohe.